Ag Must Embrace Competition As A Good Thing

I hate monopolies, but living in rural America [3]almost ensures that you will deal with monopolies every single day. For instance, I’d rather go to the dentist than deal with our telephone company. The landlines in our area are so poor, that we can’t use a fax machine. And every time it rains (which admittedly hasn’t been too often the last several years), the cracking and static make it impossible to hear. Meanwhile, using a phone line to access the Internet simply isn’t an option.

Nonetheless, the phone company has no intention of improving its equipment or service; any complaint I might register with that outfit is only of value if doing so makes me feel better. The phone company doesn’t care; plus, it knows its customers have no alternatives or options.

On one occasion, I asked the customer service person in a calm and respectful name for her name, and she hung up on me. I was so shocked and surprised that I called back two times – I guess just to verify that she would continue to hang up on me.

I’ve had similar experiences dealing with my satellite provider, but the worst offender of all is the government. I think we can all relate to this designation for the latter.

In the cases of all these entities, when those being served have no alternative for service, there is no incentive to take care of the customer or client. I’m always amazed at how the Chick-fil-A restaurant organization can teach a 15-year-old kid to be polite, customer-focused and well-mannered, but many government agencies almost seem to think their job is to make their customers lives more miserable.

It’s interesting that those of us in agriculture generally can appreciate the value of competition in other industries. For instance, the big three automakers make each other better. After all, I don’t think the quality and value of trucks[5] wouldn’t be nearly as high if Dodge, Ford and Chevrolet weren’t fighting desperately for market share.

And in contrast to our landline phone service, AT&T, Sprint and Verizon are always striving to become better and more competitive, which better serves the consumer. Meanwhile, having Toshiba, Hewlett Packard, Dell, Sony, Apple, etc., going after each other for customers makes for better computers and constant innovation.

Yet, we have a tendency in agriculture to not value competition[6]. Many among us want the government to take over our lives as a benevolent dictator and guarantee outcomes. I guess the difference is that we’re involved in a commodity business.

In a commodity business, competition leads to incessant concentration and competitiveness, rather than a focus on improving margins and growing market share. In fact, many regard more profit and more market share as leading to increased power, which can be used against smaller/weaker players.

The result is that we in agriculture have alternated between waging a war on our commodity marketplace, and waging a war against competition. Ironically, the war on competition is often presented as an attempt to increase competition.

Rural America and agriculture in general would greatly benefit from more competition, and we must be vigilant about further monopolization of our business. It’s good to know that some people just naturally do what is right, but others seem only to be influenced by whether or not the marketplace insists on it.